“When you talk about our quarter and our seventh year we are very pleased,” Jeffrey Klenda, Chairman, President, and CEO of Ur‐Energy Inc. (NYSE American: URG | TSX: URE), told InvestorIntel’s Tracy Weslosky in an interview. “We started production in August of 2013. The thing that is most astonishing about it is that during that time we have emerged as one of the lowest cost producers, not just in North America but globally.”

“Our recovery rate is in excess of 90%,” Klenda told InvestorIntel. “We are still producing out of our first mine unit, seven years after we first started production there. That is extraordinary considering that most mine units last about two to three years before they are done. It’s a beast of a project. We are in the second mine unit now and we have ten mine units to go after this. So, it is going to be a long life project.”

Jeffrey went on to speak about the Russian Suspension Agreement. He said that the Agreement has morphed into a way for Russian companies to dump nuclear fuel into the US market. As a result, the US has developed an inordinate dependency on the Russian supply. He cautioned, “it is an unwise energy policy and it is downright dangerous national security policy.”

To access the complete interview, click here

Disclaimer: Ur‐Energy Inc. is an advertorial member of InvestorIntel Corp.

“I believe there are only two places where you can make money. You got to be in Kazakhstan ISL which is working well or be in Canada because Canada has got jurisdiction and the Athabasca produces about 14% of the world’s production because they have grades 10 to 20 times global average. So you have to be in Canada but you need to be large…the thing that sets us apart is that our deposit is 50 meters from the surface. It is big, it is in Canada (Athabasca Basin region), has high grades making it easier to produce.” States Dev Randhawa, Chairman and CEO of Fission Uranium Corp. (TSX: FCU | OTCQX: FCUUF), in an interview with InvestorIntel’s Peter Clausi at PDAC 2020.

Dev went on to say that utilities are running short on inventories which is a global issue. Even defense no longer has as much uranium they used to have and is running the risk of submarines running out of energy in the middle of the ocean. The Trump Administration has decided to set aside $150 million a year for 10 years for establishing U.S. uranium reserve. Dev continued, “When there is a turn in the uranium industry it happens very quickly.” About 20% of Fission Uranium is owned by CGN Mining which Dev said, “is the mothership of our industry.”

To access the complete interview, click here

Disclaimer: Fission Uranium Corp. is an advertorial member of InvestorIntel Corp.

Given the recent announcement of a US$1.5 billion (US$150 million pa for 10 years) uranium reserve to be allocated to US uranium producers, there has been quite a buzz around the uranium sector which is currently dominated by Energy Fuels.

Energy Fuels CEO Mark Chalmers, accompanied by several members of senior management, lead an excellent Company webcast update, with a special address on the impact of the coronavirus (COVID-19) on the critical materials sector on Friday morning. During this webcast, he provided an update on the Company, covering everything from the US uranium reserve to the Company’s FY 2019 results. During this webcast he identified the increasing prioritization by the by the U.S. government for a both U.S. sourced critical materials and the build-out of a North American rare earths supply chain. Below I touch on the key highlights.

Energy Fuels Inc. (NYSE: UUUU | TSX: EFR) is one of only three US uranium miners still in production, and has been the largest US uranium producer over the past 4 years. Energy Fuels has the largest uranium resource portfolio in the U.S. among producers, with an ability to rapidly scale up production if needed. Added to this Energy Fuels is a leading U.S. vanadium producer. There is also some potential for future rare earths processing at White Mesa Mill.

The White Mesa Mill is a strategic asset for Energy Fuels and the USA

Many don’t know, but the White Mesa Mill has produced about the same amount of uranium and vanadium over its lifetime to date, or about 45 million pounds of each. White Mesa Mill can also recycle alternate feed materials and materials from land clean ups.

Energy Fuels’ flagship White Mesa Mill produces both uranium and vanadium, with potential to add rare earths processing

Energy Fuels views on Russia

Russia has a long history of manipulating markets to gain a geopolitical advantage. If nothing changes the US could be dependent on Russia, China and its allies for uranium. Also at the end of 2020, the Russian Suspension Agreement (RSA) expires. This means Russia could potentially export even more uranium into the US market leading to a price war, as we recently have seen with oil. It would also potentially increase the US’s dependence on Russia for uranium after 2021.

Energy Fuels views on President Trump’s FY2021 budget provision for a U.S. uranium reserve of US$150 million pa

Energy Fuels is positive on the recent move that the US plans to support the US uranium producers. There are no details yet on how the US$150 million pa will be allocated but there is a very strong possibility that Energy Fuels will benefit, especially given they initiated the Section 232 Petition.

The Office of Nuclear Energy (NE) stated:

“The reserve is expected to support the operation of at least two U.S. uranium mines.”

There are currently only three or four uranium facilities operating in the U.S. right now that have the current capability to supply a U.S. uranium reserve. These include Energy Fuels’ White Mesa Mill in Utah and Energy Fuels’ Nichols Ranch ISR Facility in Wyoming.

Energy Fuels (blue) has been the largest US producer of uranium over the last 4 years

Energy Fuels approach with COVID-19

Energy Fuels is adopting the following procedures to support the COVID-19 battle:

• Eliminating travel and conference attendance for the time being.
• In these tough times with low uranium and vanadium prices, Energy Fuels is focusing on cost-cutting measures and maintaining balance sheet strength.
• Energy Fuels state that of very significant concern right now is that “Kazakhstan might have to shut down uranium production due to COVID-19″. This could lead to a uranium supply shock given Kazakhstan is the world’s largest uranium producing country.

Energy Fuels FY 2019 results and current activities

• Energy Fuels end 2019 cash and marketable securities, and inventory was at $40.5 million. Added to this is $19.5 million from 2020 activities. There is also US$16 million of convertible debt that matures on December 31, 2020 (payable in cash or shares at the Company’s option). Net assets are therefore over $40 million confirming a very strong balance sheet.
• Energy Fuels is currently pursuing additional cash flow opportunities in alternative feed materials, land cleanup, vanadium & rare earth elements. Energy Fuels is participating in a pilot-scale cleanup project for Navajo Nation, and is also supporting the cleanup of a private mine in Mexico.

Note: The White Mesa Mill is the only facility in U.S. that can recycle material into usable uranium.

Rare Earth Elements

Energy Fuels has been approached by several entities including the US Government to process certain uranium bearing rare earth elements at the White Mesa Mill. Energy Fuels stated:

“We can play a significant part in bringing rare earth element production back to the United States.”

Closing remarks

With the possibility that the world’s largest uranium producing country Kazakhstan may have to shut down uranium production due to COVID-19, there is the very real potential for a supply shock to hit the uranium market.

One of the very best ways for investors to gain exposure to the US uranium and vanadium sectors is to consider investing in Energy Fuels. They stand to benefit from any uranium supply shock/price increase, an announcement of uranium contracts to build the newly announced uranium reserve, or any further announcements to support US critical materials supply. Energy Fuels’ strong balance sheet and top tier assets allow them the flexibility to turn on and off uranium and vanadium production depending on market prices.

By investing in Energy Fuels investors gain exposure to the leading US producer of both uranium and vanadium, and also a potential future rare earths processor. To gain exposure to uranium, vanadium, and rare earths (potential for processing) in one company, located in the USA, is quite unique and exceptional.

In breaking news the US Government has just released its FY2021 budget document to go forward for approval to the US Congress.

It appears that the Nuclear Fuel Working Group’s (NFWG) recommendations to support the US uranium industry have been supported, at least to the tune of a US uranium reserve per annum of US$150 million over 10 years: a $1.5 billion plan to establish a U.S. uranium reserve.

Some key points from the FY2021 US budget document are quoted below from pages 45-47:

• “Nuclear energy is also critical to the Nation’s energy mix and the Budget supports an array of programs to advance nuclear energy technologies. This portfolio promotes revitalization of the domestic industry and the ability of domestic technologies to compete abroad. The Budget provides $1.2 billion for R&D and other important nuclear energy programs, including nearly $300 million for the construction of the Versatile Test reactor—a first of its kind fast reactor that would help the private sector develop and demonstrate new technologies.
• Supports Nuclear Fuel Cycle Capabilities. On July 12, 2019, the President determined that “…the United States uranium industry faces significant challenges in producing uranium domestically and that this is an issue of national security.” The Budget establishes a Uranium reserve for the United States to provide additional assurances of availability of uranium in the event of a market disruption.”

Furthermore, the uranium reserve amounts are shown below, with US$150 million pa allocated for a “uranium reserve” for “purchase of uranium” each year from 2021 to 2030, as well as other discretionary funds.

Source: Page 127

Detailed view for FY 2021 US uranium reserve funding budget

Source: Page 397

A response from the Department of Energy’s Office of Nuclear Energy to the uranium reserve proposal

The Office of Nuclear Energy (NE) stated:

“NE is asking for $150 million to set up a uranium reserve to further protect the nation’s energy security interests. The new program will help to reestablish the nation’s nuclear fuel supply chain through the domestic production and conversion of uranium. The reserve is expected to support the operation of at least two U.S. uranium mines and will ensure there is a backup supply of uranium in the event of a significant market disruption that prevents entities from acquiring fuel. NE would begin the procurement process for the reserve in FY21.”

The “at least two US uranium mines” would suggest the two that brought forward the original Section 232 petition – Energy Fuels Inc. (TSX: EFR | NYSE American: UUUU) and Ur‐Energy Inc. (NYSE: URG | TSX: URE).

Ur-Energy Inc.’s Chairman, President and CEO Jeff Klenda added: “After years of sounding the alarm, Ur-Energy is pleased the Trump Administration has recognized the national security implications of ceding the nuclear fuel cycle to our geopolitical rivals and is now taking definitive action to shore up the domestic industry by establishing a national uranium reserve that will be supplied by domestically-mined uranium. The President’s proposed budget includes up to $150M per year from 2021 through 2030 to purchase domestic uranium. According to today’s issue of The Energy Daily DOE Undersecretary Mark Menezes commented on Monday that, “This is the beginning of a long process” to address the nuclear fuel cycle. “It won’t stop with the creation of the uranium reserve.”

Curtis Moore, VP Marketing and Corp Development from Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR) commented: “Now that we’ve had a day or so to digest yesterday’s budget news, we are increasingly optimistic about what it all means for Energy Fuels.  The Office of Nuclear Energy within the U.S. Department of Energy stated that this money is ‘expected to support the operation of at least two U.S. uranium mines …’ There are currently only three or four uranium facilities operating in the U.S. right now, that have the current capability to supply a U.S. uranium reserve, including Energy Fuels’ White Mesa Mill in Utah and our Nichols Ranch ISR Facility in Wyoming.  So, at the very least, we think this money should go toward supporting these existing, proven, low-cost facilities and saving existing jobs and expertise.

In addition, Energy Secretary Dan Brouillette and others have stated that the Nuclear Fuel Working Group will announce more recommendations in the coming weeks. It is our belief that yesterday’s announcement will support sustainable domestic uranium production of about 2-2.5 million pounds per year.  However, if the U.S. wants to have an industry capable of supplying 5-10 million pounds per year, additional actions are required. The U.S. consumes about 48 million of uranium per year, not including military requirements. So, 2-2.5 million pounds only represents a tiny fraction of total U.S. demand; even 5-10 million pounds isn’t much. So, we are interested to see what else the government has in mind.  Indeed, government officials, including Wyoming Senator John Barrasso, who has been a staunch defender of President Trump, are calling for the government to do more. And, as an American, I’d like to see the government do more.

Finally, yesterday’s announcements clearly indicate that nuclear fuel has become a major priority for the U.S. government. It is our belief that no matter which political party leads the U.S. government, this program alone has the strong potential provide Energy Fuels and perhaps a couple of other companies with a nice baseline of production and revenue, enabling us to save jobs and uranium production capacity. The alternative is to become massively dependent on Russian uranium and nuclear fuel, which nobody in the U.S. wants to see.

There’s still more work to do – in particular, how to implement this program to ensure its success. However, we believe yesterday’s announcement was a huge step in the right direction.”

Western Uranium & Vanadium Corp.’s (CSE: WUC | OTCQX: WSTRF) Founder and CEO George Glasier commented: “We are very pleased that President Trump provided for a national uranium reserve and acknowledged that the domestic production of uranium is a national security issue in his Fiscal Year 2021 – A Budget for America’s Future. The multi-year efforts of the President, Nuclear Fuel Working Group, and Department of Commerce were ground-breaking for addressing domestic critical and strategic mineral requirements and initializing the rebuilding of America’s nuclear fuel cycle. We look forward to the release of additional recommendations from the Nuclear Fuel Working Group report. In the short-term supporting domestic mining will reinvigorate hardworking mining communities, but in the end the result will be the advancement of national defense, nuclear infrastructure, and energy independence goals.”

Closing comments

The budget document is a positive response by the Trump administration to the NFWG’s recommendations to support the domestic uranium industry. At this stage it is still too early to know any details on terms – what price will the uranium be bought etc., we will provide updates as we secure them.

“In January of 2018, we submitted a Section 232 Petition which was a section under the Trade Expansion Act of 1962. This was immediately after a face to face meeting with the Secretary of Energy, Rick Perry. One of the things we were speaking to him about was our concerns that at that time we were roughly producing about 5% of our own (uranium) needs here in the United States and the other 95% was coming from outside the country. Almost 50% of that coming from Russia, Kazakhstan, and Uzbekistan. So we found ourselves in a position where although nuclear energy provides 20% of our baseload in the United States, we are allowing ourselves to become dangerously dependent on geostrategic rivals. That is a dangerous national security policy and we felt that Section 232 would be the best avenue that we can go to address that problem for the nation.” States Jeffrey Klenda, Chairman, President, and CEO of Ur‐Energy Inc. (NYSE: URG | TSX: URE), in an interview with InvestorIntel’s Jack Lifton.

A Presidential Memorandum in July in response to the Section 232 established the U.S. Nuclear Fuel Working Group to provide a fuller analysis of national security considerations with respect to the entire nuclear fuel supply chain, and specifically to develop recommendations for reviving and expanding domestic uranium production. Ur-Energy awaits the recommendations of the Working Group, which are anticipated to be made and acted upon at any time now.

Jeffrey went on to say that Ur-Energy is the lowest cost uranium producer outside of Kazakhstan. He said that state-owned companies in Kazakhstan receive subsidies from their government to offset their base cost and work under lax environmental constraints. They have also devalued their currency by 85-90 percent over the last five years, hence their costs are lower. Jeffrey also said that Ur-Energy’s Lost Creek Project is in production and the company has strong fundamentals.

To access the complete interview, click here

Disclaimer: Ur‐Energy Inc. is an advertorial member of InvestorIntel Corp.

March 26, 2018 – “I think what you see now is there were a lot of pressures on the top and each year we go past one of those pressures come off. I think the problem we have had is they have just taken longer for them all to add up. If you look at what UXC Consulting is saying they are looking at a deficit this year.” states Daniel Major, CEO of GoviEx Uranium Inc. (TSXV: GXU | OTCQB: GVXXF), in an interview with InvestorIntel’s Peter Clausi. 

Peter Clausi: GoviEx trades on the Toronto Stock Exchange, symbol GXU. You have uranium projects in Africa.

Daniel Major: Yes that is absolutely correct. We have got projects in Niger, Zambia and Mali.

Peter Clausi: What stage is each one of them at?

Daniel Major: The primary one is Niger. It is Madaouela. It is fully permitted, environmental permits, mining permits. We are working on finalizing the feasibility study for that. We are already working on the debt structuring. We have got expressions of interest from two ECAs and five banks to cover our full debt, which is two-thirds of our total capital. We are working on optimizing that project still, bringing the OPEX down, bringing the CAPEX down while the market is quiet. In Zambia we picked up two projects. We have merged them together. Got 140 kilometers of strike length already permitted by merging them together; fantastic economies of scale. Both of those projects will produce over 2½ million pounds per annum.

Peter Clausi: Where will you mill it?

Daniel Major: We will do the processing on site in both companies.

Peter Clausi: One mill for both sites or one mill each?

Daniel Major: They are so far apart country-wise. One is up in North Africa and one is in Southern Africa. It is a really long way. Both sites are going to be designed to produce yellowcake and ship out yellowcake from them. Both projects less than $38.00 a pound all including, all their capital. All the infrastructure is there, great jurisdictions. The last project we have is in Mali. It is an advanced exploration play. It has actually gone to PF once, but it was never issued so all the technical study is there. You have got a company now that has had $250 million dollars of technical studies invested on it, so well advanced.

Peter Clausi: The uranium market generally has been a hard one to predict over the past few years. We have all been waiting for a rebound in pricing and it is slowly battling its way up. What is your take on it?

Daniel Major: I have been with this company for 5 years. I have enjoyed the pleasure of sliding uranium prices. I think I have to stay a little longer to enjoy the upside. I think what you see now is there were a lot of pressures on the top and each year we go past one of those pressures come off. I think the problem we have had is they have just taken longer for them all to add up. If you look at what UXC Consulting is saying they are looking at a deficit this year. I think the overhangs we have got at the moment; you have got the impact to the U.S. guys, the Section 232 …

Peter Clausi: Right, from Energy Fuels and  . . .

Daniel Major: What it has done is just take the U.S. buyers out of the market and they are the biggest spot buyers. The guys you want there are in the market buying, they are just not there at the moment…to access the complete interview, click here

March 16, 2018 — “We think it is in the United States best interest to have a frontend in the nuclear fuel cycle of uranium mining in this country, certainly above the 4%-5% that it currently is.” states states Mark Chalmers, President & CEO of Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR), in an interview with InvestorIntel’s Jeff Wareham.

Jeff Wareham: Mark is both the CEO of Energy Fuels, but also widely regarded as a resource and as a person with a great deal of knowledge in the uranium and vanadium industries in the U.S. Mark there has been a lot of attention to uranium production. Uranium prices have been depressed for a very long time, but there has been a lot of noise around Section 232 in the last few days. Can you talk to me about that and about your role in it? 

Mark Chalmers: Yes there has been a lot of discussion about Section 232 in the recent media over steel and aluminum with the review that was done by the Department of Commerce and with the President. They were looking at imposing tariffs on making sure that the aluminum steel industry would remain strong in the United States and survive the current low prices. Now with our case, with the Section 232 for uranium, the United States is the largest consumer of uranium in the world yet we only produce about 5% of our requirements. With these current low prices, if there is not some relief— and relief could be in the form of higher uranium prices, just global world uranium prices or some sort of action that helps keep the prices up in the United States because we do not think it is in the nation’s best interest, both from the Department of Defense and from the nuclear generation capacity, which nuclear provides 20% of our electricity in the United States, to be only producing 5%, less than 5% of our requirements and securing a majority of our uranium or large portion of it, about 40% from Russia, Kazakhstan and Uzbekistan. Our company joined Ur-Energy, the two of us jointly put in a petition to the Department of Commerce. We have not heard that they have initiated the process. We expect them to initiate the process. We think it is in the United States best interest to have a frontend in the nuclear fuel cycle of uranium mining in this country, certainly above the 4%-5% that it currently is.

Jeff Wareham: Now with the steel situation they have looked to impose tariffs. My understanding is you guys have suggested going in a different direction, correct? 

Mark Chalmers: Yeah, we looked at a quota of up to 25% of U.S. requirements. We also put in a provision for a Buy American or preference to Buy American uranium. I want to emphasize that the objective of the petition is to make sure that this front end of the nuclear fuel cycle survives. We are very challenged right now, but we also understand that a number of the steps in the nuclear fuel cycle, including the nuclear generation is challenged as well too. We want an outcome that is going to allow us to survive, but also make sure that the nuclear industry in the United States stays healthy and robust going forward…to access the complete interview, click here

Disclaimer: Energy Fuels Inc. is an advertorial member of InvestorIntel Corp.

March 12, 2018 — “The nuclear industry in the United States has been challenged with natural gas and the increase in renewables lately. We do not want to be greedy here, but we do think that a frontend of the nuclear fuel cycle is required in the United States,” states Mark Chalmers, President & CEO of Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR), in an interview with InvestorIntel’s Jeff Wareham.

Jeff Wareham: Mark, uranium and vanadium have both been in the news a lot lately. First of all, can you comment on what is going on in the market and particularly what is going on politically in the U.S.?

Mark Chalmers: Uranium itself has historically been a political, kind of, element. We as a company, with Ur-Energy, we filed a Section 232, a trade petition, to limit imports of uranium into the United States. Now Section 232 is quite in the media a lot right now with the steel and aluminum. I think people did not know what Section 232 even meant up until a few days ago when the Trump administration, after a review by the Department of Commerce, is looking at imposing tariffs on imports from various forms from different countries. We as a company we actually started this process about a year ago. We felt that the low level of production in the United States— The United States is the largest consumer of uranium in the world, but we are only actually producing less than 5% of our requirements. The Section 232 is a trade act that is driven for any type of commodity, like uranium or vanadium or in the cases of steel or aluminum that may have national security implications. That is what we have put in with Ur-Energy.

Jeff Wareham: I think that would be a pretty compelling case that uranium is an important strategic element. On that basis, you guys are already a producer. Obviously a U.S. producer would be extremely benefited by any kind of ruling under 232. 

Mark Chalmers: Yeah, we would be benefited naturally. But, the thing is that we want to be reasonable with the Section 232. We want to survive as an industry. The nuclear industry in the United States has been challenged with natural gas and the increase in renewables lately. We do not want to be greedy here, but we do think that a frontend of the nuclear fuel cycle is required in the United States. It is really, again, when we talk about national security issues, it is not just Department of Defense. It is really more focused on the nuclear power generation industry for the electricity because 20% of our electricity comes from nuclear.

Jeff Wareham: Sometimes people do not regard uranium production as being something that is particularly green. From my understanding of your business you guys provide some very green services, not only in how you process your own materials, but also in cleaning up other projects or other mining operations. Is that correct?

Mark Chalmers: Yeah. We have the White Mesa Mill in Utah. It is the only remaining conventional mill in the United States that is operable. We have two sources of revenue with that facility. We have what we call alternate feed, which is basically taking out of spec material or low-level material that we can actually run through the mill and recover the uranium and repackage. We are basically recycling products that had uranium in it…to access the complete interview, click here.

Disclaimer: Energy Fuels Inc. is an advertorial member of InvestorIntel Corp.